Getting Into Karma Finance

UBI Plus
3 min readAug 31, 2020


How Does It Work?

In short, Karma Finance is a decentralized protocol on Ethereum for direct, P2P giving where the sending party stakes ETH to mint KARBS tokens for the ultimate benefit of a receiving party, while either party can increase the value of rewards through various mechanisms.

It works like this: User A stakes Ethereum to mint KARBS, the protocol token. The longer they stake the more KARBS that can be minted in return. They can also use KARBS, the governance token, to multiply their minting ability.

User A then gives User B a portion of their KARBS (or all of it). User B can also choose to stake their tokens to increase the potential size of their reward, or claim their reward immediately. The reward here is the ETH released to the reward pool when KARBS was minted.

Besides serving as the ‘multiplier’ token for KARBS, the KFI token will also be used for governance and running the community. In fact, 100% of KFI tokens will either be distributed to the community in return for helping make the project a success or, when tokens are sold from the main wallet, have its value transferred to the KARBS reward pool.

The Two Tokens

The two Karma Finance tokens form a symbiotic relationship, each adding value to the other. The more value one will have, the more value the other can realize.

$KFI: The Governance and ‘multiplier’ token for $KARBS.

$KARBS: The Karma DeFi protocol token.

Further, the smart contract that runs it will be open-sourced and autonomous, without any dev control. After initializing the contract, the developer will have the same rights as everyone else.

How Can I Participate?

Karma Finance is intended to be almost entirely organic, self-sustaining, and self-evolving.

We will also partake in our own model and rely on the burgeoning Karmafi community from the very beginning. If Karma Finance offers some value, we think it is natural that the community would want to keep it going.

We will begin this journey with the first of many community rewards. In return for providing liquidity, you can receive a number of $KFI tokens. For every 1 ETH of liquidity provided before September 1, 2020 at 12PM GMT you will receive 250 $KFI before October 31, 2020 (along with your original ETH).

(Note that excess ETH will be returned without reward. The value of the reward will decrease as demand increases, but a reward schedule will be posted as needed. And as a necessary disclaimer, you would be sending ETH to a stranger over the internet who may disappear and go shopping for gucci slippers. There are no guarantees that your contribution will ever be returned. Risk/reward.)

The journey begins!

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A blockchain-based mechanism that provides incentives to private individuals acting in their own best interests to fund a decentralized UBI scheme.